Exercise $9-29($Algo$)$ Plantwide versus Department Allocation $($LO $9-2,3)$

West State Furnibure $($WSP$)$ manufactures deiks and desk chairs using teo departments within a single facility. The West Departhent produces the desks, and the Siate Department produces the chairs. WSF uses plantwide allocation to allocate its overhead to all materials, and dinect labor were as follows.

$\backslash$table$[[,$Deski,Chairs$],[$Sales revehie,$11\mathrm{.}26$e$,906,51,065,$ e$20],[$Direct materials,$315,946,313,651],[$Direct laber,$192,060,125,5$e$0]]$

Repulined:

a$.$ Compute the proft or loss for each product using plantwide allocation.

b$.$ The new CFO at WSF was surgrised that the company used a plantwide rebe, because the lwo products were produced in separate deparmente. The ecest enolyst estimatod the overhesd rates for each department separabely Using department raters, the West Depanteent rabe would be $33$ percent of direct materials cost. The Saste Department rabe would be $102$ percent of direct materials cost. Recompute the poofis or loss for each product uning each departments alocation rate fased on direct materials cost in each department!

$\backslash$table$[[,$Profirer Lets$],[,$Denk,Ctairs$],[1.$ Uninge plaritaide atiocation,,$],[$t$.$ Using Anpetweers allocation nie,,$]]$